Many business owners assume that once a job is finished or a product is sold, their responsibility ends. In reality, liability exposure can continue long after work is completed or a product leaves your hands.
Products and Completed Operations coverage is a component of many commercial general liability policies that addresses certain claims arising after a product is sold or work is finished.
It’s an important — and often misunderstood — part of commercial insurance.
What Is Products & Completed Operations Coverage?
Products and Completed Operations (often called PCO) coverage generally applies to third-party bodily injury or property damage claims that occur away from your premises and after your work is complete or your product is sold.
Depending on the policy, this coverage may help address claims alleging:
- A product you manufactured or sold caused injury or damage
- Completed work later resulted in property damage
- An installation or repair failed after the job was finished
Coverage applies only when the claim meets policy definitions, terms, and exclusions.
How Products & Completed Operations Differs From General Liability
This is a common point of confusion.
Commercial General Liability coverage typically addresses:
- Injuries or damage that occur during ongoing operations
- Incidents that happen at your premises or job site
Products & Completed Operations coverage focuses on:
- Claims that arise after the work is done
- Claims that occur away from your location
- Liability tied to products or completed services
Both are important, but they respond to different timing and circumstances.
Businesses That Commonly Need Products & Completed Operations Coverage
PCO coverage is especially important for businesses whose work or products continue to create exposure after completion.
This includes:
- Manufacturers, fabricators, and product assemblers
- Contractors and trades (plumbers, electricians, HVAC, carpenters)
- Installers and service providers
- Distributors and wholesalers
- Repair and maintenance businesses
For manufacturers, this exposure can last for years after a product is sold. For contractors, it may apply long after a project is completed and paid for.
Examples of Products & Completed Operations Claims
Every claim is different, but examples may include:
- A manufactured component fails and damages a customer’s equipment
- A completed installation later causes water damage or electrical failure
- A finished repair does not perform as expected and results in property damage
- A product defect allegedly causes injury months after sale
Whether a claim is covered depends on policy wording and circumstances.
Products & Completed Operations Aggregate Limits
Most general liability policies include a separate aggregate limit for products and completed operations claims.
This means:
- There is a cap on how much the policy will pay for all PCO claims combined during the policy period
- This aggregate is often separate from the general liability aggregate
For businesses with ongoing product exposure or repeated completed work, this aggregate limit can be just as important as the per-occurrence limit.
Why Products & Completed Operations Coverage Is Often Overlooked
PCO coverage is frequently overlooked because:
- It’s bundled into general liability policies and not clearly explained
- Business owners focus on job-site or premises risks
- Claims may not arise until months or years later
- Aggregate limits aren’t always reviewed closely
Unfortunately, this exposure often becomes clear only after a claim occurs.
How PCO Coverage Fits With Other Insurance
Products & Completed Operations coverage often works alongside:
- Commercial general liability insurance
- Manufacturers insurance
- Contractors insurance
- Umbrella or excess liability insurance for higher limits
- Professional liability (E&O) when services involve advice or design
Understanding where PCO ends and other coverages begin can help reduce gaps.
Reviewing Products & Completed Operations Exposure
When reviewing PCO coverage, it’s helpful to consider:
- How long your products remain in use
- The potential severity of a failure
- Contractual liability requirements
- Whether your aggregate limits are adequate
- How PCO coverage interacts with umbrella insurance
These factors vary widely by industry and operation.
Final Thoughts
Products & Completed Operations coverage addresses a simple reality: liability doesn’t always end when the job is finished or the product is sold.
Understanding how this coverage works — and how it fits into your overall insurance program — can help businesses better prepare for long-term exposure.
Learn More or Request a Coverage Review
If your business manufactures products or performs work that continues to create exposure after completion, it may be worth reviewing your Products & Completed Operations coverage.
Call: 781-396-2116
Contact: Request a review online
Insurance coverage cannot be added, deleted, or changed until confirmed in writing from our office.
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